1) Casette Tapes - became cash-rich
TCL and Vodafone
Both these organisation had simple vision and
goals, were strongly aware of environment, and
own capabilities.
2) Telephones (Build Nation Wide Network)
TCL (Li Dongshang) Founded 1986,
3) Developed relationship with Tompson
(France) and bought out manufacturing in
Poland etc. 68% stake.
Japanese firms are good a OE but often poor
in strategy. (Exceptions are, Sony, Canon &
Sounthwest Airlines (Simple internal flights) Continental failed with Continental Lite
Vanguard Group (Investments) - contrast with
Citibank, (WS, p. 67)
Jiffy Lube - Focus exclusively on car lubricant
change (cheep and rapid service)
Variety-based positioning
Neutragena - postioned near pharmasuitical, so
could not participate in discount and varity,
employees skills and attitude had to remain
focuesd, i.e no deoderants, cheep soaps, price
Vodafone (spinoff from Racal, already well
established in UK telecommunications
Needs-based positioning
Ikea (Low price, trendy furniture) (WS p. 66)
Cutomer georgaphy or scale
Access-Baseed positioning (WS, p. 67)
Carmike Cinemas
fit that is strategy specific is the most valuable
(amplifies trade-offs)
First-Order fit (simple consistancy, between
activity and overall strategy) (WS, p71)
Position Strategies
Vanguard, minimumpoertfolio turnover
consistance with low fees
Second-Order fit (when activities are
reinforcing, Neutrogina markets to upscale
Types of Fit (WS, p70)
Third-Order fit (WS, p72), Gap restocking daily
from near warehouses, model cycle six to eight
fit locks out immitators. Everything matters.
Fit drives both competitiveness and
Fit and Sustainability
(WS) [What is Strategy?, Michael E. Porter,
Harverd Business Review Nov-Dec 1996]
The most viable position are those with
incomatible trade-offs (WS, p74)
Need to avoid over-design of production
activities, e.g. using highly skilled persons for
simple tasks. (this grounded Continental Lite)
see WS
Strategic planning should have an horrizon of
ten or more years
Vital is the need of trade-offs
Hiding in immitation
Growth can blur uniqueness (WS, p77)
Rasing the barriers
Failure to choose strategy (WS, p75)
No choice is "safer" than the wrong one.
Reposioning is not enough. (WS, p68)
Maintains competitivemens but is not strategy.
Ever increasing OE improvements is game of
diminishing returns as competitors match
improvements. Example: R.R. Donnelley &
Sons profit margin 7% (1980) tp 4.6% (1995)
Elimination of competitors through M&A
Operational Excellance (OE)
'Hypercompetition' is a self-inflicted wound.
Competitive strategy is about being different,
((WS) p. 64)
See diagram (WS, p71)
Diagram (WS, p73)
[See Guidence in box (WS, p76)]
Role of leadership (WS, p77..78)
Mistaken "customer sevicee" for services all
requests through all channels.
Dessire for growth Maytag (Washers and
Dryers) (WS, p76) Huge growth through M&A
but severe decline on ROS.
Detail Force
One definition states: “Defeat in detail is a
doctrinal military term that means to defeat an
enemy by destroying small portions of its
armies instead of engaging its entire strength”
(Erickson, 2003).
competitive advantage too temperary
Positioning is not enough
too static